Tuesday, February 5, 2013

BP mulls Browse gas stake - The West Australian

BP has just days to scupper PetroChina's $US1.63 billion ($1.56 billion) plan to buy into the Woodside Browse LNG project.As Shell manoeuvres to convince its joint venture partners to go with a floating solution for the Browse gas development, pre-emptive rights held by the Woodside Browse partners to match PetroChina's offer for BHP Billiton's about 11 per cent in the consortium are understood to expire early next week.

BP has long been regarded as interested in increasing its about 17 per cent stake in the Browse project because it is underweight in Australian upstream oil and gas when compared with rivals Royal Dutch Shell, Chevron, ExxonMobil and ConocoPhillips.


  1. I dont like it.
    Where is the certainty to say "this boom will go for 20 years" ?

    The way things are going Woodside will be caught up in a big shooting war with Israel promising to blast Iran before they can put a nuke together.That looks like July at latest.

    And all this going on at the same time.


    China, Japan on the brink

    Chinese warships have pointed missile radars at Japanese military targets and taken the two regional powers to the brink of "a dangerous situation", say Japanese officials.

    The news overnight marks a dangerous escalation of a four-month diplomatic and military stand-off between Australia's two largest trading partners, involving disputed islets in the East China Sea.

    Japan's defence minister, Itsunori Onodera, told reporters last night that a Chinese frigate pointed a missile control radar at the Japanese destroyer Yuudachi on January 30.

    "Something like fire-control radar was directed at a Japan Self-Defense Maritime escort ship in the East China Sea," Mr Onodera told reporters in Tokyo.


    He also said a Chinese vessel had similarly targeted a Japanese ship-based helicopter two weeks earlier.

    "This is extremely abnormal behaviour," Mr Onodera said.

    "One step in the wrong direction could have pushed things into a dangerous situation," he said.

    China last night sidestepped the specific Japanese allegations while urging calm.

    A Chinese foreign ministry spokesman urged Japan "to stop all provocative actions" including sending vessels and planes to the Diaoyu Islands, known as Senkaku in Japanese.

    "We hope Japan can take actions to show sincerity and willingness to work with China through talks and negotiations to control and manage the current situation," said spokesman Hua Chunying.

    Diplomats and military officials in the United States, Japan and China had previously warned that the dispute was only one accident away from open military conflict.

    But last night's news out of Tokyo suggests the two regional powers have come closer to live fire than many had feared.


    South Korea predicts multiple nuke tests

    South Korean President Lee Myung-Bak believes North Korea could detonate multiple devices when it goes ahead with a nuclear test expected in the coming weeks or days.

    In an interview published on Tuesday in the Chosun Ilbo daily, the outgoing president also acknowledged the huge challenge the international community faces in seeking to wean Pyongyang off its nuclear weapons program.

    The North has signalled that it will carry out a "higher level" nuclear test very soon, in a defiant response to tightened UN sanctions after its successful long-range rocket launch in December.

    Lee said "higher-level" suggested Pyongyang might attempt to detonate several devices.


    "North Korea is likely to carry out multiple nuclear tests at two places or more simultaneously" to maximise scientific gains from an event that will be globally condemned, Lee said.

    Experts around the world are gearing up to analyse any test for what it might reveal about the current status of the North's weaponisation program.

    Of particular interest will be any sign that its scientists have succeeded in developing a warhead that can be fitted onto a missile.

    "If the North produces miniaturised weapons that can be used as warheads on missiles, it would really pose a threat," Lee said. "That's why the whole world is watching it so intensively."

  2. The miners whinging again."We want it all our way."

    Miners draw the line on native title

    LABOR'S proposed changes to native title laws have come under an 11th-hour assault from miners, farmers and the resources states, amid concerns they will lead to more legal challenges, higher costs, greater inefficiency and more agricultural land being subject to the laws.

    Details of the three-pronged attack on the new laws came as the Coalition's shadow cabinet was understood to have discussed the bill yesterday and will determine in its partyroom today whether it will support the contentious bill.

    The new laws for the first time define "good faith" negotiations to ensure indigenous people are not just paid "lip service", make voluntary indigenous land-use agreements less technical and more flexible, and provide new access for indigenous people to claim title over national parks.

    The powerful Minerals Council of Australia has warned the Gillard government that the proposed laws will create a system with "increased contestability", higher costs, longer timeframes for decisions and "uncertainty for stakeholders".


    In a last-ditch submission to the parliamentary committee looking at the final bill, the MCA says it is not clear how the new laws will contribute to the efficiency and operability of the native title system, adding that they do not "promote fair, transparent and timely decision making".

    "We also are not convinced that the proposed measures will achieve the intended outcomes of providing more clarity, improving agreement-making, encouraging flexibility in claim resolution and promoting sustainable outcomes," the MCA submission says.

    "Instead we believe that these reforms will create a native title context of increased contestability, costs and timeframes for determinations, and uncertainty for stakeholders."


    While indigenous leaders have been supportive of the changes, many were disappointed they did not reverse the onus of proof, which requires Aborigines to show a continuous association to land.

    That burden of proof meant claims were difficult, expensive and slow to resolve, they say.


    The West Australian and Queensland governments have also provided new submissions arguing against the bill.

    The Barnett government's assessment is that "the majority of proposed changes are unnecessary and will increase uncertainty and inefficiency in the management of native title".

    "The WA government considers that there are better options available to the commonwealth government to assist in the native title process other than further changes to the NTA," its submission says.

    "These include the commonwealth government engaging in good-faith negotiations with the states and territories to develop functional forward-looking policies to expedite the resolution of native title claims and to develop socially and economically productive native title agreements."


    The bill provides that parties must use all "reasonable" efforts to reach agreement. Reasonable, however, is not defined in the bill.


    Minerals Council asks,"what does Good Faith mean?"

  3. US and Canada step on the gas

    JUST hours after the Canadian government approved its third export gas project, another US export gas project, this time in Texas, has moved closer to getting a green light.

    The approvals come as concern is mounting that a large rise in North American gas reserves on the back of the shale gas boom will undercut much of the optimism of Australia's gas exporters over projects being developed off Western Australia and in Queensland.

    Australia is set to be one of the world's largest gas exporters in the next five years, although growth prospects beyond that are being hurt by the increase in export projects vying for approval in North America.

    On Tuesday Shell won approval for a project it is promoting in British Columbia, on Canada's west coast, which includes PetroChina, Korean Gas and Mitsubishi Corp as shareholders. Both PetroChina and Mitsubishi are participants in export gas projects in Australia.


    As well, the US Department of Energy granted Pangea LNG approval to begin exports from its south Texas project. Pangea has been authorised to export up to 8 million tonnes annually of liquefied natural gas for 25 years.

    Shell, also, has joined another consortium planning to export gas from Georgia, in the US south.

    The inability of large vessels to use the Panama Canal always meant that gas exports from the US could only be exported to Asia from the west coast and Alaska, but that will change from late 2015 when the canal's capacity rises after a $US5.5 billion ($A5.28 billion) expansion.

    This, along with surging gas reserves, thanks to the boom in shale gas in the US, will pave the way for gas to be shipped from the US gulf states to Asia for the first time.

    The rise in the number of export projects seeking to get off the ground in north America comes as companies such as Origin Energy are seeking to win export orders so they can boost future shipments from domestic gas export projects.

    It is developing a project with initial sales of about 9 million tonnes annually of gas exports, with a second tranche planned. It is expected to update investors this month on its progress in selling gas abroad, which will enable it to give the green light to the second tranche of its Queensland project.

    Origin's partner in Queensland is ConocoPhillips, which is seeking to develop an export gas project in the US so as to export to Osaka Gas, which is also buying gas from the Origin's Queensland project.

    The Pangea project needs other approvals before it can proceed, mainly from the US Federal Energy Regulatory Commission. It hopes to be in operation by 2018.

    1. Japan gains more support on Capitol Hill to be main beneficiary of US LNG exports

      Tuesday, 05 February 2013

      Japan is gaining more support in the US Congress to be a main beneficiary of the LNG export project developments currently underway to trade the country's huge natural gas surplus from the shale gas boom.

  4. Where Shell may spend it's money - and there is NO MENTION of Browse at JPP!

    Royal Dutch Shell Plc (RDSA), Europe's largest oil company, and China Petrochemical Corp. are possible buyers of a stake in a A$23 billion ($24 billion) liquefied natural gas project in Australia, JPMorgan Chase & Co. said.

    Shell, through its Arrow Energy Ltd. venture with PetroChina Co., may bid for a stake in the Australia Pacific LNG project being built by ConocoPhillips and Origin Energy Ltd. (ORG), Jason Steed and Christopher Laybutt, Sydney-based analysts at JPMorgan said yesterday in a report.

    ConocoPhillips and Sydney-based Origin are developing the APLNG venture in Queensland state, one of seven projects going ahead in Australia to tap Asian demand. Origin has said JPMorgan was hired for the sale, which would help fund the project, and that the process will last through the first quarter.

    If Origin successfully sells a 7.5 percent stake, its "capital position will be dramatically improved" by about A$2 billion, the JPMorgan analysts said.

    China Petrochemical, known as Sinopec Group, already owns 25 percent of APLNG, leaving Origin and Houston-based ConocoPhillips (COP) with 37.5 percent each. Origin said in July that it's looking to keep about 30 percent of the project after the partners jointly agreed to further cut their stakes.

    Lv Dapeng, Sinopec Group's Beijing-based spokesman, didn't answer calls to his office today seeking comment. A call to Shell's Australian media line wasn't immediately returned.

    Origin has sufficient funds to meet its share of APLNG to 2015 and to "support the ongoing needs of the business," the company reiterated today in an e-mailed response to questions.

    Three Plants

    While a failure by Origin to reach an agreement to reduce its project ownership will "undoubtedly dent sentiment," it won't necessarily prompt the company to sell shares to raise funds, according to the analysts at JPMorgan, who also named infrastructure investors as potential buyers.

    Origin, Santos Ltd. (STO) and BG Group Plc have approved construction of three LNG plants in the state. Shell said in November it may delay until 2014 a decision on whether to go ahead with the Arrow venture amid rising costs in Australia.

    Shell has slowed the pace of developing new LNG projects in Australia "where there is cost inflation pressure," Chief Executive Officer Peter Voser told investors on a call yesterday. The company is taking more time on an expansion of the Gorgon LNG project operated by Chevron Corp. off the northwest coast and on Arrow, he said.

    Shell was studying plans to combine its Arrow gas resources with third parties, Andy Brown, director of international production, said in November.

    "We see a potential transaction with Arrow as adding the most project value," David Leitch and Andrew Moller, Sydney- based analysts at UBS AG, said yesterday in a report.

  5. 24 million tones per annum - Shell LNG plant in Canada.

    The National Energy Board (NEB) said it has approved an application by LNG Canada Development for a licence to export liquefied natural gas (LNG) from a proposed terminal near Kitimat, British Columbia.

    The export licence will authorize LNG Canada, a joint venture comprised of Shell Canada, Korea Gas Corporation (KOGAS), Mitsubishi Corporation and PetroChina, to export 670 million tonnes of LNG (approximately equivalent to 32.95 trillion cubic feet of natural gas) over a 25-year period. The maximum annual quantity allowed for export will be 24 million tonnes of LNG (approximately equivalent to 1.18 trillion cubic feet of natural gas). The daily equivalent of these exports is 3.23 billion cubic feet per day.


    “In approving the application, the Board satisfied itself that the quantity of gas to be exported does not exceed the surplus remaining after due allowance has been made for the reasonably foreseeable requirements for use in Canada, having regard to the trends in the discovery of gas in Canada,” the National Energy Board said in a statement.


  6. BP is NOT looking too flash.At all.

    BP hit by new $34bn Deepwater Horizon claim

    Latest demand comes from local and southern state governments, including Louisiana and Mississippi, hit hard by pollution following 2010 blowout

    has been hit by a new $34bn (£21.7bn) claim for alleged economic losses and punitive damages resulting from the Deepwater Horizon oil spill in the Gulf of Mexico .

    The latest demand comes from local and southern state governments, including Louisiana and Mississippi, hit hard by the pollution that followed the blowout on the BP-operated Macondo well in April 2010.

    BP described the methodology for calculating the claims as "seriously flawed" and the oil company said it was confident it would not have to make additional financial provisions.

    BP refused to say what provisions it has already made for the $34bn claims, but admits to having taken a further $4.1bn "charge" in the final three months of 2012, bringing the total amount set aside so far to $42.2bn.

    The oil company has settled criminal charges with the US department of justice, but will suffer further financial hits as it prepares for a final civil trial scheduled to start on 26 February.

    Worst case scenarios could mean a further $20bn of liabilities in the event of the company being found "grossly negligent", but BP expects any fine to be very much smaller and is still desperately working on an out-of-court settlement to avoid the trial.

    The latest numbers resulting from the Deepwater disaster were released by BP on Tuesday morning as part of its fourth-quarter and full-year financial results, which showed the company had already sold $37.8bn of assets even before its sale of its half share in the Russian joint-venture TNK-BP to Rosneft.

    That disposal has not been completed yet, but BP's overall production – excluding TNK-BP – was down 7% in the final three months to 2.29m barrels of oil equivalents a day.


    BP has reported a 19% fall in profits for 2012 to $17.6bn (£11.2bn), down from $21.7bn the previous year, just days after the US court approved a record $4bn fine for the Gulf of Mexico oil spill.